It's part of a small but growing market for digitally printed books. Even as people embrace Kindles and other gadgets for reading, bookstores are finding a market for titles printed in small custom batches.

Oscar's Art Books in Vancouver says it has sold about 1,500 digitally printed books since it bought a special printer in March. The machine, which cost about $118,000, accesses an online library of titles and then prints, trims and binds paperbacks on demand.

"Of course the fun is being able to watch their book being made," says Oscar's manager Barry Bechta, who says people congregate around the machine to watch books print.

The price typically depends on the number of pages printed. Last week Oscar's printed a copy of "Dr. Art Hister's Guide to Living a Long & Healthy Life" for a customer for $19.95.

Publishing houses are also showing more interest in digital printers, which can economically print books based on demand, rather than traditional presses, which mass produce titles that can later sit unsold in warehouses or be converted back into pulp. In response, companies including Xerox Corp.XRX2.32% and Eastman Kodak Co. are making a bigger push into digital printers for so called "short runs."

ENLARGE

The machine, one of only 24 worldwide, allows for on-demand book printing of books that aren't in stock.
Brett Beadle for the Wall Street Journal

The number of books printed digitally is small but expected to grow. About 4% of books are currently printed digitally, but that's expected to grow to 15% by 2015, according to market-research firm Interquest.

Bertelsmann AG unit Offset Paperback Manufacturers, which prints books for publishers, has been using one of Kodak's digital printers since March. CEO Dave Liess says he's seeing more demand for smaller print batches as publishers seek to better manage inventory.

Independent bookstores have been among the most enthusiastic buyers of in-store digital printers. Being able to print a not-in-stock book lets small bookstores offer a bigger selection and better compete against chains.

One such printer is called the Espresso Book Machine, made by a New York firm called On Demand Books LLC. It has sold 51 printers to 50 locations, including Oscar's.

The machine itself—which includes a computer and devices that trim and bind books—costs $97,500, plus the actual printer. Stores can choose from a Kyocera Corp. printer for $4,000 that prints 30 pages per minute, or a Xerox printer listed at $50,000 that prints 110 pages per minute.

On Demand started selling the machines in 2006 but says sales have picked up in the last year and a half as some stores use it to manage inventory better and offer more titles. Chief Executive Dane Neller declined to discuss sales figures.

For the most part, books printed on the Espresso Book Machine look like regular paperbacks, although it can only print color covers, not inside pages. It costs the bookstore under a penny a page to print, plus a licensing fee.

On Demand partners with Google Inc. to get access to older so-called "public domain" titles, and with Ingram Content Group Inc.'s Lightning Source for in-copyright titles. For Google titles, stores pay a licensing fee of $2 per book, split between Google and On Demand; for Lightning Source books, the fee varies.

Harvard Book Store in Cambridge, Mass., installed an Espresso machine with Xerox's printer last September and prints about 1,000 books a month on it, says print-on-demand manager Bronwen Blaney.

The bookstore, which isn't affiliated with the university, makes less profit on books it prints, because the cost to print and license the book is generally higher than the cost of buying an already printed book, says Ms. Blaney. But she says it's worth it because the store is getting a sale it otherwise wouldn't.

Blackwell, a book chain in the U.K. with 40 stores, installed an Espresso machine in its London flagship store in April 2009 and is considering adding around six more machines over the next 18 months. Blackwell CEO Andrew Hutchings says his only gripe is that the selection of contemporary titles it offers isn't as robust as he'd like it to be.

Barnes & Noble Inc.,BKS0.23% the largest U.S. bookstore chain by revenue, doesn't have on-demand printers in stores. Analysts say that smaller bookstores have more reason to buy the in-store printers because they don't have the storage space the big chains do.

Barnes & Noble, however, does partner with Lightning Source to custom print books it doesn't have in stock online or in stores. Barnes & Noble does about $20 million in annual sales for on demand printing, a figure that has been rising each year, says a spokeswoman.

Rival Borders Group Inc. also doesn't offer on-demand printers in its stores, though it uses Lightning Source to fulfill some online orders.

"We are evaluating the technology and will determine at a later date whether to make it part of our service offerings," says a spokeswoman.

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